Cleantech outlook gloomy for VCs

SAN JOSE, Calif. – Venture capitalists and startup chief executives are generally lowering their expectations about the U.S. economy in 2013 as well as market sectors including cleantech and medical devices. However they are generally most bullish on business and health care IT spending and Latin America, according to a new survey.

Forty-nine and 42 percent of startup CEOs and VCs respectively expect the U.S. economy to improve next year, according to the 2013 Venture View survey conducted by the National Venture Capital Association (NVCA) and Dow Jones VentureSource. That’s down from last year when 53 and 47 percent of the two groups expected economic improvements.

Expectations for overall VC spending in 2013 also went down slightly in the latest survey. Forty-three percent of startup CEOs and 27 percent of VCs said they expect VC spending will rise next year, down from 45 and 32 percent in last year’s survey.

“Ongoing uncertainty surrounding the fiscal cliff clearly impacted respondents’ outlooks for the coming year,” said NVCA president Mark Heesen. “The influence the federal government has over the growth or stagnation of our industry has never been greater, [and] lawmakers need to understand that their brinkmanship politics is hurting the entrepreneurial ecosystem, which has been grasping for positive news for the last four years."

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Most respondents expect to see increased spending in business IT (61 percent) and health care IT (57 percent) in 2013 (see graph above). They expect decreases in clean technology investments (61 percent) and medical devices (53 percent).

Geographically, 55 percent of respondents said Latin America will see increasing U.S. investment in 2013 followed by China (40 percent) and India (37 percent). U.S. investments are most likely to decrease in Western Europe, said 55 percent of respondents, followed by Eastern Europe (36 percent) and Japan (30 percent).

The survey queried more than 600 U.S. executives between Nov. 26 and Dec. 7.